Recognizing and Embracing the Opportunities in Dynamic Digital Signage

When most of us see the word “opportunity” in a title, it automatically catches our eye begging the question of just what that opportunity might be. According to Merriam-Webster’s Dictionary, opportunity is defined as “a favorable juncture of circumstances and a good chance for advancement or progress”. If we couple that definition with the opportunities confronting us in dynamic digital signage we certainly have a favorable juncture and also one that will provide a great chance for advancement and progress in our sign businesses.

Truth be told, all businesses are looking for opportunities for growth but in the case of the traditional sign industry that has seen relatively slow growth over the last few years, these new opportunities may be more addressable and attainable than some may have thought possible. We will begin by looking at the size of the market and then the individual segments that have already adopted dynamic digital signage. We will examine what we call “natural fit” applications that you can take advantage of and ultimately how to combine this in your business and keep it all in focus. Just remember as we progress that the average dynamic digital signage system sale is between 1 to 5 displays and this type of average sale makes up the vast majority of this multi- billion dollar market.

We will start our journey of exploration with the size of the opportunity. The global dynamic digital signage market grew to nearly $14 billion by year-end 2013 according to IHS Inc. This report as well as others, sets worldwide revenue for dynamic digital signage equipment and also includes software, services and media with the US market accounting for over one third of that. By 2017, total dynamic digital signage will amount to $17.1 billion. As a point of reference and comparison, it is estimated that the traditional signage industry generated just over $52 billion globally in 2013. As we look at the numbers, keep in mind that the dynamic digital signage industry as it exists today is approximately 10 years old, making the market revenue growth data even more significant and thus a very exciting opportunity.

No matter the size of the project, if we look at dynamic digital signage from an overall rate of growth estimates vary depending upon the specific research report but one thing is clear and that is the growth is in double digits and will continue for the foreseeable future. Once again, contrast this to the traditional sign industry where the growth over the last few years has been flat or in some cases declining partly due to the poor economy but even with the improving economic outlook, the growth of the traditional sign industry is being forecasted in single digits.

A significant factor in the lower growth figures relates directly to the traditional signage market being mature. As a technology or an industry reaches the level of maturity, it is typical for the rapid growth they have experienced up to that point to decline. There is perhaps no better example than in the high tech world of the venerable PCs we are so familiar with. Whether we look at a desktop or even a laptop, growth has declined and it is the “new kids on the block” – the tablet and smart phone that are creating the excitement. In the case in the case of the signage market it is dynamic digital signage that is driving significant growth.

As a side note, do not be intimidated with sheer billions of dollars in terms of sales and all the reports of multi-thousand display dynamic digital networks being rolled out. The fact is that while these very large projects tend to get all of the press, the average dynamic digital signage system sale is between 1 to 5 displays and this type of average sale makes up the vast majority of those billions of dollars. This is right in the “sweet spot” for most sign shops.

Keeping with our analogy of computers and signage, there is no need to worry about our PCs and laptops actually going away because they are now mainstream and mature. They will in fact evolve and be joined by other technologies and in the process re-create rapid growth and so it is in the sign industry. Traditional signage will never go away but the addition of dynamic digital creates growth and re-energizes the market with new technologies that excite the senses. In short, it is not an either/or situation but an added opportunity to be embraced.

Now that we know the market size and the growth potential of dynamic digital signage, let’s see how it fits into your existing client’s needs and applications that you already address. Remember, that dynamic digital is an additional revenue stream and one that if nurtured will grow inside and beside your existing business. The secret is to understand it, embrace it, and profit from it by re-invigorating your client base with new and expanded thinking, products, and yes, opportunities.

Dynamic digital signage does a lot of what traditional signs do only with dynamic movement (not necessarily video by the way!) and the ability to change content upon demand. It is used for many different purposes/objectives but here are some of the most common applications of dynamic digital signage along with the estimated percentage of the overall dynamic digital signage business as it exist today.

As you can see there is huge overlap in the applications for traditional signage and dynamic digital. Most of you are currently involved in selling static signs to retail, quick serve restaurants, corporations, healthcare, entertainment venues, etc. We would suggest that sign shops do their own customer segment analysis assigning a percentage of your current business to each type of customer. This study will provide guidance on what niches to concentrate on as you add dynamic digital signage applications to your portfolio. This analysis can also be valuable in helping you to determine the percentage of incremental revenue available from your existing customer base.

Secondly take a look at what we call “natural fit” applications for dynamic digital. In other words, where does it simply make good business sense for a customer to add dynamic digital to their existing static sign infrastructure? This can be from an added features and benefits perspective or in some cases a total cost of ownership point of view with return on investment as the deciding factor. In cases such as this, it is up to you to make the ROI case and not vice versa.

Your existing clients must be thought of as “yours” and not somebody else’s customer. Research shows that in increasing numbers, sign clients are looking for new and exciting ways to attract consumer attention, entertain or educate and are actually paying for these new services. It goes without question that you want them to buy any and all signs from you. As noted earlier they will not abandon static signs in an either/or situation but they will add dynamic to their mix of ways to reach their customers. From our perspective these are your customers and we want you to keep them.

Clients report that dynamic digital signage has some advantages which include consistently influencing customer behavior by multiple means including getting them into a store in the first place, directing customers to different areas, increasing the dwell time on the store premises, and changing the message continually in response to the changing needs of the facility in relation to the viewer. Digital signs reportedly enhance the customer experience by capturing the viewer’s attention and reduces perceived wait time in restaurant waiting areas, bank queues, etc. It can even enhance the environment with video walls, interactive screens, and dynamic art work. As a side note, this is not all by accident.

With our smart phones, tablets and portable devices, we are being programmed and conditioned to want and expect this level of communication. A recent article in the New York Times reports that nearly 70% of Americans are confronted with dynamic digital signage each day and that we spend on average 8 hours a day in front of one screen type of another. Programmed? You bet!

Just as digital printing changed the nature of the traditional sign industry, adding dynamic digital to the mix will equally alter the situation today and make a sign shop both large and small more profit and retain customers in the process. Here are some words to the wise to consider:

Just as in the traditional sign industry, there are several vertical markets to choose from and each one has their own unique applications and challenges.

Avoid a one size fits all approach and offer customized solutions designed specifically for selected vertical markets.

From a sign shop business development perspective, invest in positioning and promoting your company inside the vertical markets you have chosen. .

Look at opportunities from the perspective of the customer and develop a better understanding of end-user needs and usage modes for displays and static signs as well.

Avoid looking like everyone else and differentiate yourself in the market and to your customers in particular by offering compelling end-user solutions rather than simply a standalone sign

Work with customers to increase their understanding of tangible value with proof of measureable ROI and ROO.

Form meaningful alliances for products and solutions with partners who can support and expand your efforts and business prospects.

It is a business fact of life that the entire signage market is evolving, growing and changing and the segment known as dynamic digital signage is growing at a very rapid pace by some estimates of over 20% per year. By understanding the benefits of adding dynamic digital signage to your existing business or even opening a new department to focus on this niche, it will supplement and not replace what you have done over many years. It is not an either or situation but a blending of types of signs and strategies to best serve your customers and remain current and relevant.

In each and every dynamic digital signage project no matter how small or how large, the 7 Key Elements of Dynamic Digital Signage come into play. These elements are made up of:

Business issues include setting the objectives and a consideration of a return on the investment.

Content is the vehicle that drives the attainment of the objectives and is what the viewer sees and responds to.

Design is the look and feel of the signage system and how it is laid out.

Software or the content management system is the engine that controls the content.

Hardware includes items like displays, mounts, media players, etc.

Connectivity speaks to connecting the displays to the network

Operations include project management, installation, training and service after the sale.

We recommend that sign shops understand and embrace The 7 Key Elements of Dynamic Digital Signage as a focal point to help guide them through the process. And finally, as your explore new opportunities in the sign

industry, remember that industry friends are good and partnerships necessary. Most of all, recognize these opportunities and enjoy the journey.